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Friends Provident International has over 40 years of experience in the international life assurance market. They provide savings, investment and protection solutions to customers in Asia and the UAE and have offices in Dubai, Hong Kong, UK, Singapore and the Isle of Man.
Friends Provident International Limited (FPIL) is now owned by International Financial Group Limited (IFGL).
IFGL provides investment, savings and protection solutions to international investors around the world and the group comprises of RL360, RL360 Services, Ardan International and Friends Provident International.
The IFGL group employs 650 staff and administers assets of US$24 billion for 210,000 customers.
Reserve is an international investment plan that Friends Provident International claims is suitable for customers with a lump sum to invest for a minimum of five years, who seek capital growth or regular withdrawals, or a combination of both.
Reserve is available to those who are aged 18 and over. If the plan has lives assured, the minimum age is 2 years old and at least one life assured must be
80 or younger.
The Reserve Investment Bond requires you to invest a lump-sum payment of at least GBP 50,000. This needs to be invested for at least 5 years or an early cash-in charge may apply.
The Reserve Bond has two plan options:
Features of Reserve Investment Bond:
The establishment charges of Friends Provident International's Reserve Investment Bond would depend on whether you have appointed a DFM (Discretionary Fund Manager) or not. Let's have a look at what it would be without a DFM:
|Currency||No discretionary fund manager appointed||Annual policy charge option|
|Whole of life||Capital redemption|
If you later wish to add to your plan, the minimum additional payment is as follows:
|Currency||Establishment charge option||Annual policy charge option|
Friends Provident International's Reserve also has two investment options, namely:
1. Collective investments:
Under collective investments, you can invest your money in the following:
2. Personalised assets:
Under this investment option offered by FPI, you can invest your money in:
You can exchange existing assets into your plan which comply with the structures. The minimum value of an asset to be exchanged into your plan is GBP 5,000 (an asset exchange charge will apply).
We would recommend reading the expert verdict section of this review to understand why our experts gave Friends Provident International's Reserve Investment Bond 3 out of 5 stars in this independent review.
This depends on whether a whole of life plan or a capital redemption plan is selected.
1. Whole of life plan:
2. Capital redemption plan:
According to Friends Provident International, Reserve is an international investment plan suitable for customers with a lump sum to invest for a minimum of five years, who seek capital growth or regular withdrawals, or a combination of both.
Reserve is available to those who are aged 18 and over. If the plan has lives assured, the minimum age is 2 years old and at least one life assured must be 80 or younger.
NOTE: We would recommend reading the expert verdict section of this review before making a decision.
Well, apart from the cost...here's what FPI say are the main risks to be aware of: -
What you get back in the future depends on how well the investments perform.
The value of the plan can go up and down. You could get back less than you’ve paid in.
Friends Provident International only guarantee the value if the capital redemption version is chosen and the plan is cashed in at the end of the 99-year fixed term.
When you cash in your plan, you may get back less than your illustration shows. This could happen for several reasons, for example, if:
– investment returns are lower than shown
– charges are higher than shown
– you take out more money than shown.
Some assets carry a higher level of risk than others and may be subject to sudden and large falls in value. This could erode some or all of your capital.
If you or your investment adviser deal excessively and your portfolio value is relatively small, then the value of your Reserve plan may be eroded and the costs may be disproportionately high.
If you invest in an asset denominated in a currency different to the plan currency, the value can go up and down simply because of changes in the currency exchange rate.
Inflation will reduce the spending power of any money you get back in the future.
In order to apply to this plan, you simply need to complete the application form and return it to your financial adviser along with the required documents.
For the required documents, please see the ‘Reserve – application form’.
Payments are only be accepted by:
– telegraphic transfer
– banker’s draft
– asset exchange.
GTA stands for General Transaction Account.
Friends Provident International set up General Transaction Accounts in the currencies you
These operate as cash accounts and receive any
payments you make to them or they make to you.
Any transactions such as charges to be taken, and the buying and selling of investments, will also pass through these accounts.
I've seen my lump-sum eroded by charges, fees and commissions...
I was duped by an adviser and know better now!
Like many other offshore investment bonds, we have seen (all too often) the FPI Reserve Bond being used or sold to investors within QROPS and SIPPs.
This is done in order to generate more commission for the salesperson.
The FPI Reserve Bond should not be used within a QROPS or SIPP, because when you start to draw on your pension, the charges may still apply on the original investment, which effectively means your charges will go up as the capital decreases - and will erode some of the remaining capital at a quicker rate.
In short, used in the right circumstances, offshore bonds can provide attractive tax benefits (but definitely not within SIPP or QROPS).
However, in many instances, they can be mis-used by commission based salespeople to extract high levels of commission. Our advice is to incept such a plan only after receiving advice from a fully regulated UK- qualified financial planner, and to opt for a cleanly priced option without any form of establishment charge or lock-in period (zero-exit penalties).
If you already have a Reserve Offshore Investment Bond from Friends Provident International, and it is worth £250,000 or more, we strongly recommend you seek a Second Opinion to ensure you are on track to get and keep the life you want.
There's every chance you're paying far too much for an inappropriate product. Learn more from our deep dive into Friends's Provident International's Reserve Investment Bond.